Famed emerging markets investor, Templeton's Dr. Mark Mobius, told "Globes", "We haven't switched sides in the battle for control of Taro Pharmaceutical Industries Ltd. (Pink Sheets: TAROF.PK). We are always on one side the side of investors."
Mobius heads the Templeton Emerging Markets Fund, which owns about 10% of the shares of Israeli pharmaceutical company Taro. Taro is the subject of an extended battle for control between Chairman Barrie Levitt and India's Sun Pharmaceuticals.
Mobius referred to Templeton's decision to remove itself from Taro's appeal against Sun in the Supreme Court. Templeton opposed Sun's takeover of Taro from day one first it worked against Taro, and later, when Taro cancelled the deal, Templeton joined it in processes against Sun.
Taro trades on the US pink sheets, after not publishing financial statements on time.
Globes: The unaudited results that Taro published for the first six months of the year were good. Do you think that Taro management is lying to investors and that the situation is bad?
Mobius: We don't know what the situation is, because there are no reports. Maybe the situation is excellent, and maybe management is lying. Until there are audited reports, we won't be able to know.
The price that Sun is supposed to pay, if the court rules in its favor, is lower than the price that you paid for Taro shares. You have claimed throughout that this price is too low.
We don't worry about the price, we worry about the company. The question of price is secondary at this time.
Mobius advises investors to vote against the current Taro board in a vote on reelecting the directors. He points out that Templeton has been in contact with other investors as well. He says that Templeton believes that there is a need to elect new directors at Taro, and while his fund has not proposed any candidates of its own, it will consider doing so if there is a need.
Where would you advise not to invest today?
I prefer not to define areas where it does not pay to invest, because it is possible to find opportunities everywhere. The areas where I do see investment opportunities, besides the Middle East, include, for example, China, Brazil, Ukraine, and Nigeria.
Which sectors does it pay to emphasize in 2010?
I recommend commodities companies. Not commodities themselves, but the companies. Also companies geared toward consumers are recommended. There are two areas that will be interesting in the coming year.
Published by Globes [online], Israel business news - www.globes-online.com - on December 15, 2009
© Copyright of Globes Publisher Itonut (1983) Ltd. 2009